Kriptoks

The SPELL Token is a digital asset that is used as a governance token for the decentralized crypto lending platform Abracadabra Money. The platform allows users to borrow and lend using interest-bearing tokens (ibTKNs) as collateral for the minting of Magic Internet Money (MIM), a stablecoin that is pegged to the value of the US dollar.

Launched in May 2021, Abracadabra Money is a cross-chain lending protocol that enables its users to make use of the interest-bearing tokens they have earned in vaults (e.g., xSUSHI, yvUSDT) so that the capital can be utilized. The project is run by a team led by a co-founder known only as "Squirrel," along with Daniele Sesta, who is responsible for Popsicle Finance (a decentralized market maker) and Wonderland (an OlympusDAO fork), both of which are on the Avalanche chain.

Abracadabra Money has three main tokens: SPELL, sSPELL, and MIM. SPELL is the protocol's token, which is used for incentivization and governance, sSPELL is obtained by staking SPELL tokens and used for fee-sharing and governance, and MIM is a multichain stablecoin backed by interest-bearing tokens. SPELL is available on Ethereum, Fantom, Avalanche, and Arbitrum. It was distributed in May 2021, and then half of all SPELL tokens were burned, reducing the supply from 420 billion to 210 billion. A further 5.25 billion tokens were burned in January 2022.

SPELL is the native token of Abracadabra Money, primarily built on the Ethereum blockchain and bridged to other networks like Fantom and Avalanche via AnySwap. It serves as a governance and incentive token within the Abracadabra Money ecosystem. Its primary use cases are governance and fees earned from the protocol (interest, borrowing, and 10% of liquidation for certain markets).

Holders of SPELL can stake their tokens to receive sSPELL, which grant holders voting rights and passive income from fees generated by the protocol. sSPELL tokens represent users’ shares of the SPELL fee pool with a mechanism similar to the SUSHI/xSUSHI model, with 10% of all liquidation fees hardcoded to be taken out and used to purchase SPELL tokens in certain markets. These SPELL tokens are also added to the SPELL fee pool, and 75% of the protocol’s revenue is used to buy back SPELL tokens, while 25% builds up a treasury.

Depending on the amount of ERC-20 sSPELL (staked SPELL) held, users can create new proposals for the protocol. The proposal threshold is 100 million sSPELL. Voting power is given by holding sSPELL tokens in the wallet, as collateral in Abracadabra Money's sSPELL lending market, or any other contracts recognized by the protocol; or with SPELL/ETH SushiSwap LP tokens deposited in Abracadabra Money's farm. Once a proposal is passed, the team considers whether or not to implement it.

The main use of the SPELL Token is for the liquidity mining program in order to keep liquidity deep on Abracadabra Money's lending markets, with 63% (132.3 billion) of SPELL allocated to that purpose. Different lending pools have different levels of SPELL emissions. A total of 665,448,024 SPELLs are currently minted per week as of the time of writing.

In conclusion, the SPELL Token is a unique and innovative digital asset that serves as a governance token for the decentralized crypto lending platform Abracadabra Money. It allows users to borrow and lend using interest-bearing tokens as collateral for the minting of a stablecoin that is pegged to the value of the US dollar. The project is run by a team led by a co-founder known only as "Squirrel," along with Daniele Sesta, who is responsible for Popsicle Finance (a decentralized market maker) and Wonderland (an OlympusDAO fork), both of which are on the Avalanche chain.

The SPELL Token has multiple use cases and benefits for its holders. By staking SPELL tokens, users can receive sSPELL, which grants them voting rights and passive income from the fees generated by the protocol. They can also participate in the governance of the protocol by creating new proposals and voting on them. Additionally, the SPELL Token is used for liquidity mining, which helps to keep liquidity deep on Abracadabra Money's lending markets.

Abracadabra Money's unique approach of using interest-bearing tokens as collateral sets it apart from other stablecoin/lending protocols like MakerDAO. Its cross-chain capabilities, combined with its use of Linux OS resources, make it a versatile and powerful platform for creating smart contracts and decentralized applications. With its ability to run on multiple blockchain networks, its off-chain computations, and its mainstream programmability, Abracadabra Money is poised to bring the power of decentralized technology to a wider audience of developers and users.